Renting a mortgaged property

Answered according to Hanafi Fiqh by Askimam.org

My question is regarding living in North America, according to paying rent versus having a mortgage. At the moment I am currently paying rent to a landlord to live in their triplex, and instead my family wants me to move into a residence that they own. The issue is that they are paying a mortgage on the condo, where I am just paying for my rent in the place I reside in now

Their argument is that I am basically doing the same thing which they want, since my landlond has a mortgage on his building, which is the case for the vast majority of places and it extremely difficult to find a place where this doesn’t exist, so the majority of the time the landlord has a mortgage and rents out units in the building to pay off their mortgage.

I am not knowledgeable enough to know whether my current situation is even permissible, but in regards to my family’s offer, is it permissible for me to move into their condo even though they have a mortgage on it?

If not, than how can I explain to them that what I am currently doing is not the same thing?

 

Jazakallah Khairan for your time, I appreciate the effort that you have all done in making this website and in taking the time to answer my question.

Answer

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

You refer to mortgage and renting. In essence, mortgage as understood in the American context being an interest bearing loan is prohibited. Allah Ta’ālā says,

الذين يأكلون الربا لا يقومون إلا كما يقوم الذي يتخبطه الشيطان من المس ذلك بأنهم قالوا إنما البيع مثل الربا وأحل الله البيع وحرم الربا.

Those who take ribā (usury or interest) will not stand but as stands the one whom the demon has driven crazy by his touch. That is because they have said: “Sale is but like ribā”, while Allah has permitted sale, and prohibited ribā. (Verse: 2:275)

 

يا أيها الذين آمنوا اتقوا الله وذروا ما بقي من الربا إن كنتم مؤمنين. فإن لم تفعلوا فأذنوا بحرب من الله ورسوله وإن تبتم فلكم رءوس أموالكم لا تظلمون ولا تظلمون.

O you who believe, fear Allah and give up what still remains of ribā, if you are believers. But if you do not (give it up), then listen to the declaration of war from Allah and His Messenger. However, If you repent, yours is your principal. Neither wrong, nor be wronged. (Verse: 2:278,279)

 

However, renting is permissible even though it is of a mortgage property. This is irrespective of whether the mortgaged property is owned by a Muslim or not; a Muslim who took out the mortgage will be sinful for the mortgage contract. The Muslim tenant will not be sinful for that.

It is also permissible to live in your family’s mortgaged home.  

And Allah Ta’āla Knows Best

Hisham Dawood

Student, Darul Iftaa
Chicago, USA

Checked and Approved by,
Mufti Ebrahim Desai.

www.daruliftaa.net

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